Telcos look to new game plan in the 5G era

No doubt, top of mind for most of the big telco players in Australia are the business opportunities associated with rapidly emerging technologies, and in particular 5G. With the explosion of Internet of Things (IoT) and the need to create new digital experiences for customers that eliminate pain points, the way telecommunications infrastructure is being employed continues to change fast.

These emerging new uses, and associated rise in demand, are set to dramatically increase reliance on such infrastructure over the coming decade. The Asia Pacific region alone is expected to reap more than US$1.8 trillion of economic value added from mobile technologies and services by 2022, and it will be home to 2.7 billion mobile internet users by 2025.

With this backdrop, its unsurprising that carriage service providers and the retail service providers (RSPs) are now looking for market differentiation and additional revenue opportunities as 5G progressively rolls out across the nation.

Yet many telcos must also consider the data service technology they use and whether it can manage and make sense of the explosion of the commoditised data – especially if they want to truly maximise the value they can get out of 5G.

Accommodating the Internet of Things (IoT)

A prime area that is set to be increasingly facilitated by 5G and underpinned by data services systems is the Internet of Things (IoT) – the rapidly expanding range of internet-connected devices being employed for things as diverse as healthcare, industrial automation, self-driving vehicles and more.

IoT is big business, as is the data it uses and creates. Indeed, analyst firm IDC predicted that the Asia Pacific region (excluding Japan) would spend US$291.7 billion on IoT in 2018. Moreover, it was estimated this would account for more than 40 percent of the total worldwide IoT expenditure in 2018.

Regardless of the network advances taking place as the IoT landscape explodes, managing the resulting influx of connected devices and the data they create is set to become an increasingly complex challenge.

Rolled into the IoT explosion is the concept of smart cities. For instance, a smart city could have autonomous cars communicating with traffic lights and pedestrians’ smartphones to anticipate traffic conditions and avoid collisions.

Since driverless cars need to make those decisions in real time, they need to leverage 5G networks in order to share and obtain vast amounts of data from multiple devices quickly and reliably.

In 2018, IDC flagged predictions that would see the Asia Pacific (excluding Japan) region spend US$28.3 billion on smart city solutions. This momentum has continued through to 2019, where telcos in the local region, including Australia, are building up their 5G capabilities to capture that revenue opportunities.

In fact, a study by Analysys Mason found that 28 percent of mobile operators in developed Asia Pacific markets will be ready to offer commercial 5G services by 2020, which is higher than the expected global average of eight percent.

Since every connected device generates and runs on data, the rise of IoT and smart cities will result in a frankly staggering amount of data exchange over networks. As providers and resellers of those networks, telcos are therefore in an advantageous position to uncover customer insights that may actually help improve customer experience and reinforce brand loyalty.

By using AI and machine learning to improve customer experience, telecommunications providers can anonymise and analyse such customer data to provide valuable insights to other industries.

One potential use case would be the sharing of movement patterns of shoppers and their dwelling times in malls – which is based on customers’ location-based data – with retailers. Having location intelligence can help retailers better customise promotions to drive consumer spending, as well as decide the next optimal store location.

In these ways, telcos are looking at news ways to adapt to the new industry landscape that is emerging in tandem with the 5G revolution by expanding their existing core competencies and adding new services to drive and facilitate the adoption of IoT, smart cities, data analytics and AI.

At the core of local telecommunications providers’ adaptation to the new 5G world is data prowess; the data services and systems underpinning and enabling the core competencies that lie at the heart of the additional value telcos can offer around their 5G rollouts will prove to be a vital element in the future of Australia’s telco landscape.

Copyright 2019 IDG Communications. ABN 14 001 592 650. All rights reserved. Reproduction in whole or in part in any form or medium without express written permission of IDG Communications is prohibited.